ACIT, DELHI V. MS ELCO GLOBAL VENTURES LLP, DELHI

ITA 749/DEL/2024

AI Insights

The case involves the Income Tax Department (revenue) appealing against the order of the Learned Commissioner of Income Tax Appeals (CITA), which had deleted an addition of Rs. 15,14,33,100 made by the Assessing Officer (AO) on account of unexplained purchases. The AO had initially added this amount as unexplained purchases due to non-compliance with a notice under Section 142(1) of the Income Tax Act, 1961. However, the assessee contended that they had provided all necessary details and documents through the ITBA portal, which the AO failed to consider. The CITA accepted the assessee's submissions, leading to the deletion of the addition. The revenue challenged this decision, leading to the current appeal.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 824799 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 10 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-12-2025
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2012-2013
• Appeal Filed On: 19-02-2024
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: POOJA SWAROOP
• Assessee Lawyers: NIKHIL GOEL
• Keywords: Additional evidence; TDS; Source of fund
• Section: 147; 148; 143(3); 142(1); 139

Judgement Text

"Page | 1 INCOME TAX APPELLATE TRIBUNAL DELHI BENCH “B”: NEW DELHI BEFORE SHRI C. N. PRASAD, JUDICIAL MEMBER AND SHRI M. BALAGANESH, ACCOUNTANT MEMBER ITA No. 749/Del/2024 (Assessment Year: 2012-13) ACIT, Circle-28(1), Delhi Vs. M/s. Elcom Global Ventures LLP, C-23, Greater Kailash, Enclave Part-1, Delhi (Appellant) (Respondent) PAN: AADFE3216H Assessee by : Shri Nikhil Goel, Adv Revenue by: Ms. Pooja Swaroop, CIT DR Date of Hearing 26/11/2025 Date of pronouncement 30/12/2025 O R D E R PER M. BALAGANESH, A. M.: 1. The appeal in ITA No.749/Del/2024 for AY 2012-13, arises out of the order of the National Faceless Appeal Centre (NFAC), Delhi [hereinafter referred to as ‘ld. NFAC’, in short] in Appeal No. ITBA/NFAC/S/250/2023- 24/1058356447(1) dated 30.11.2023 against the order of assessment passed u/s 147 r.w.s. 143(3) of the Income-tax Act, 1961 (hereinafter referred to as ‘the Act’) dated 08.12.2019 by the Assessing Officer, NFAC, Delhi (hereinafter referred to as ‘ld. AO’). 2. The revenue has raised the following grounds of appeal before us:- “1.That on facts and circumstances of the case and in law, the Ld. CIT(A) has erred in violating provision of Rule 46A of Income Tax Rule for not calling for Remand report when AO has not received any submission from assessee during the course of assessment proceedings. Printed from counselvise.com Page | 2 2. That on facts and circumstances of the case and in law, the Ld. CIT(A) has erred deleting the addition of Rs 15,14,33,100/- made by the AO on account of unexplained purchases. The assessee failed to prove the genuineness and credit worthiness of the entities from whom the assessee firm has borrowed huge amount of funds, therefore the same remained questioned and unexplained.” 3. We have heard the rival submissions and perused the materials available on record. The assessee is a firm engaged in the business of real estate. The return of income for the assessment year 2012-13 was filed on 28-03-2013 under section 139 of the Act. The case of the assessee was sought to be reopened under section 147 of the Act vide issuance of notice under section 148 of the Act on 30-3-2019. The assessee filed return in response to notice under section 148 of the Act on 23-09-2019 declaring total income of Rs Nil and requested for providing the reasons recorded for reopening the assessment. The Learned AO duly provided the reasons for reopening vide letter dated 3-10-2019 to the assessee. The reopening was initiated by the Learned AO based on the information received from ITO ward 1(2) Ghaziabad that assessee had an immovable property transaction of Rs 1,48,00,000. Notice under section 143(2) and 142(1) of the Act stood issued to the assessee. Various replies were filed by the assessee before the Learned AO in response to various questionnaires issued by the Learned AO. 4. The Learned AO vide notice under Section 142(1) of the Act sought details of complete purchases of Rs. 15,14,33,100. According to Learned AO, the said notice was not complied with by the assessee, which lead the Learned AO to add the sum of Rs.15,14,33,100 as unexplained purchases for want of documentary evidences. The re-assessment was completed determining the total income of the assessee at Rs. 15,14,33,100. The assessee submitted before the Learned CITA that detailed replies by furnishing the complete details Printed from counselvise.com Page | 3 of purchases were indeed filed by the assessee before the Learned AO itself in response to Questionnaire dated 1-12-2019. The very same details were again furnished by the assessee before the Learned CITA. The complete details of amounts received from partners of the LLP and from others were also furnished by the assessee before the Learned AO. The assessee furnished the complete bank account details of Union Bank of India before the Learned AO. The assessee had also furnished the complete details of current liabilities in the format prescribed by the Learned AO. These details were again furnished by the assessee before the Learned CITA. The assessee had filed the complete bank statements showing the payment and sources for the sum of Rs. 15,14,33,100 in the following format together with their respective sources thereon as under:- S. No. Name and Address of the Property purchased Date of Payment Cleared/withdrawa ls. from bankaccount Amount Source of Payment Date of Registered deed 1. H.No.2012, 04.04.2011 90,00,000/- Opening balance in 12.07.2011 Sector 15, Chandigarh (Purchase Price) bank account from amount received as loan from Three CInfratech Pvt. Ltd. in the F.Y. 2010-11 in the m/o March 2011 11.05.2011 90,00,000/- (Purchase Price) Opening balance in bank account from amount received as loan from Three CInfratech Pvt. Ltd. in the F.Y. 2010-11 in the m/o March 2011 04.07.2011 9,00,000/- (Stamp Duty) Opening balance in bank account from amount received as loan from Three CInfratech Pvt. Ltd. in the F.Y. 2010-11 in the m/o March 2011 23.09.2011 1,80,000/- and net of TDS is Rs. 1,62,000/- (Commission) Opening balance in bank account from amount received as loan from Three CInfratech Pvt. Ltd in the F.Y. 2010-11 Printed from counselvise.com Page | 4 in the m/o March 2011 TOTAL (A) 1,90,80,000/-^ 2. H. No.2308, Sector 35-C, Chandigarh 10.05.2011 1,48,00,000/- (Purchase Price) Opening balance in bank account from amount received as loanfrom Three CInfratech Pvt. Ltd in the F.Y. 2010-11 in the m/o March 2011 13.05.2011 10.05.2011 7,55,000/- out of Rs.8,00,000/- (Stamp Duty and Regd. Opening balance in bank account from amount received as loan from Three CInfratech Pvt. Ltd. in the F.Y. 2010-11 in the m/o March 2011 Charges) 23.09.2011 1,48,000/- and net of TDS is Rs. 1,33,200/- (Commission) Opening balance in bank account from amount received as loan from Three CInfratech Pvt. Ltd. in the F.Y. 2010-11 in the m/o March 2011 TOTAL (B) 1,57,03,000/- 3. W-81, GKII, NewDelhi 30.03.2011 11,00,00,000/- (Purchase Price) From amount received as loan from Three CInfratech Pvt. Ltd. in the F.Y. 2010-11 in the m/o March 2011 9.05.2011 28.04.2011 66,00,000/- (Stamp Duty and Regd. Charges) From amount received as loan from Three CInfratech Pvt. Ltd. in the F.Y. 2010-11 in the m/o March 2011 06.05.2011 50,100/- (Stamp Duty and Regd. Charges) From amount received as loan from Three C Infratech Pvt. Ltd. in the F.Y. 2010-11 in the m/o March 2011 TOTAL (C) 11,66,50,100/- GRANDTOTAL (A+B+C) 15,14,33,100/- 5. The assessee further explained the transactions by stating as under:- Printed from counselvise.com Page | 5 From the above facts, it is very clear that out of total payments of Rs.15,14,33,100/- the amount of Rs. 11,00,00,000/- was paid in the earlier F.Y.2010-11 (This amount was shown under the head Loans & advances at Relevant Page 4 S.N.3(b) of ITR Form showing total amount of Rs. 11,00,00,000/-out of Rs 12,00,00,000 attached at Annexure “B”) and the balance money of Rs.4,14,33,100/- has been paid in F.Y. 2011-12 and all such money was received from Three C Infratech Pvt Ltd and Parleen Chopra in the earlier F.Y. 2010-11.In the year under consideration no new loans have been taken as is also clear from:” 6. The Learned CITA observed that the entire details had been duly filed by the assessee on 3-12-2019 in the ITBA portal and appreciated the fact that no fresh loan was received by the assessee during the year under consideration and that, out of the total payments of Rs. 15,14,33,100, an amount of Rs. 11 crores was paid in financial year 2010-11 which was shown under the head ‘loans and advances’ in the balance sheet and the balance money of Rs. 4,14,33,100 has been paid in financial year 2011-12 out of monies received from Three C InfraTech Private Limited and Perlin Chopra, which were received in financial year 2010-11. Hence the borrowings were made in earlier years, the payments for purchase of properties were made partly in assessment year 11-12 and partly in assessment year 12-13. The Learned CITA deleted the addition made by the Learned AO by observing as under:- “6.2. Carefully considered the submission of the appellant in view of the impugned assessment order. Also perused and considered the details and documents uploaded by the appellant on ITBA portal during the appellant proceedings. Went through the case laws referred to and relied upon by the appellant. 6.3. The appellant firm was engaged in the business of real estate. During the Assessment Year under reference the appellant firm did not show any sale but showed purchase of land for Rs. 15,14,33,100/-. A perusal of a copy of the audited Balance Sheet of the appellant firm for AY under reference shows that the opening balance of stock in trade was Rs. 9,01,66,500/- and during the year purchases of Rs.15,14,33,100/-was made, against which no sale has been shown by the appellant. Accordingly, the closing balance of stock in trade has been shown at Rs. 24,22,11,121/-. Vide questionnaire and a notice u/s 142(1) of the Act, dt. 01.12.2019 ld. AO raised detailed queries in a tabulated format about the purchases made during the year along with the detail of the source of funds Printed from counselvise.com Page | 6 used for the purchases. Ld. AO also asked about the bank accounts maintained by the appellant firm along with a copy of the complete bank statement of those bank accounts. The date for compliance was fixed for 04.12.2019. Ld. AO has maintained in the impugned assessment order that the appellant did not file any reply, detail or document as called for from him vide abovementioned notice. Further, ld. AO issued a show cause notice on 06.12.2019 fixing the date for compliance on 08.12.2022.In the impugned assessment order ld. AO has maintained that no reply was filed by the appellant till the date of passing the captioned assessment order dated 08.12.2019. 6.4. In the written submission uploaded on ITBA portal the appellant has submitted that it had furnished complete reply along with details and documents on 03.12.2019 as per the format and tables required by the ld. AO. The appellant has submitted that it had filed the above submissions through ITBA Portal on 03.12.2019 vide acknowledgement Number 03121912479914. During the appellate proceedings the appellant furnished a copy of system generated acknowledgement bearing number 03121912479914 and comprising the detail of the documents furnished by the appellant on 03.12.2019. From these facts of the case, it transpires that the ld. AO, due to an oversight did not check the ITBA Portal before passing the impugned assessment order. 6.5. During the appellate proceedings, the appellant firm filed a reply in the form of paper book, comprising complete copy of the reply dated 03.12.2019 along with the covering letter uploaded by it on 03.12.2019 during the assessment proceedings. A perusal of the above reply shows that the appellant had filed a point wise reply to the notice u/s 142(1) dated 01.12.2019. The appellant had provided the details of all three properties purchased during the year, in a tabulated format, as desired by the ld. AO. The aggregate cost of the property purchased is Rs.15,14,33,100/-The appellant firm furnished the copies of bank statements showing and highlighting the date wise payments made against the property purchased. Further, the appellant has furnished copies of all purchase/ sale deeds of the property purchased by it during the year under reference. 6.6. Regarding the source of funds out of which payments were made against the purchase of the properties under reference, the appellant has submitted that it had taken loans from the two parties, namely M/s Three C Infratech Pvt. Ltd. Rs. 23,30,00,000and Parleen Chopra Rs. 2,50,00,000. A perusal of the balance sheet of the appellant it appears that the said loans have been shown under the head current liabilities and entire amount is appearing as opening balance. During the AY under reference no unsecured loan was obtained by the appellant firm. Ld. AO also has not raised any query about the unsecured loan received in the immediate preceding previous year. 6.7. The impugned addition was made by the ld. AO on account of purchases made by the appellant during the year under reference for the alleged reason that it did not file any reply against queries raised by the ld. AO vide notice dt. 01.12.2019. But this is the matter of fact that the appellant had Printed from counselvise.com Page | 7 not only filed a reply on 03.12.2019, before the given date (i.e. 04.12.2019) for compliance with, but also furnished complete details and documents as asked for by the ld. AO. From the facts of the case, it is clear that the ld. AO did not take cognizance of the reply filed by the appellant. During the appellant proceedings, I have perused the reply filed by the appellant in view of the queries raised by the ld. AO during the assessment proceedings. Since the appellant has substantiated the issue raised by the ld. AO, I am of the considered opinion that the addition made by the ld. AO does not have any cogent basis. Therefore, Id. AO is directed to delete the addition of Rs. 15,14,33,100/- made by him on account of purchases made by the appellant firm during the assessment year under reference. Accordingly, grounds no. 3 and 4 of the appeal are allowed.” 7. We find that the revenue had challenged the order of the Learned CITA by stating that he had admitted additional evidences filed by the assessee before the Learned CITA and that no remand report was sought from the Learned AO. We find at the outset that no fresh details or additional evidences were filed before the Learned CITA. All the details were already filed by the assessee through the ITBA portal during the course of assessment proceedings itself which were not looked into by the Learned AO while framing the assessment. Since, the Learned AO had not made verification of the aforesaid details with evidences, we deem it fit and appropriate, in the interest of justice and fair play, to restore this appeal to the file of the Learned AO for denovo adjudication in accordance with law in the light of aforesaid evidences filed by the assessee. Accordingly the appeal of the revenue is allowed for statistical purposes. 8. In the result, the appeal of the revenue is allowed for statistical purposes. Order pronounced in the open court on 30/12/2025. -Sd/- -Sd/- (C. N. PRASAD) (M. BALAGANESH) JUDICIAL MEMBER ACCOUNTANT MEMBER Dated: 30/12/2025 Printed from counselvise.com Page | 8 A K Keot Copy forwarded to 1. Applicant 2. Respondent 3. CIT 4. CIT (A) 5. DR:ITAT ASSISTANT REGISTRAR ITAT, New Delhi Printed from counselvise.com "